A Society of Mutual Benefactors

Thu, Aug 15, 2013 - 10:39am

Today, we add our seventh, permanent guest contributor to the TFMetals arsenal...the late, great Puck T. Smith.

Long-time Turdites will recall "Puck" as a wise and gentle soul who considered TFMR as a refuge from the madness that surrounded him at his home near Washington, D.C. Sadly, Puck was diagnosed with terminal esophageal cancer back in February and he passed in April.

Fortunately for all of us, he had maintained his own blogspot site which you can find here: https://pucksmith.blogspot.com

To honor his memory and to keep his "work" alive, I've decided to occasionally copy and paste some of my favorites from his site. We begin today with this beauty, which he, himself, had copy and pasted from a book entitled "It's a Jetsons World", by Jeffrey Tucker.

Thanks again, Puck, for being such a valued part of TFMR. R.I.P.


A Society of Mutual Benefactors

An excerpt from It's a Jetsons World.

By Jeffrey Tucker

Checking out at the grocery store the other day, I paid for my sack of rolls. The checkout person handed me my bag.

"Thank you," I said.

"You're welcome," she replied.

I walked away with a sense that something was wrong. Do check- out people usually say, "You're welcome," and nothing else? Not usually.

Usually they say, "Thank you," same as the customer says. (Remember, we are talking about the American South, land of politeness, here.)

I was left with an inchoate sense of: "Hey, I did something for you too."

When do we say, "You're welcome"? We say that when we give a gift (a good or service) to a person without receiving anything in return. For example, I might hold a door for a person. That person says, "Thank you," and I say, "You're welcome." Another time might be at a birthday party when the recipient of a gift expresses thanks.

These are one-way examples of benefaction. We are giving but not necessarily getting anything tangible in return. What makes the case of the commercial exchange different? Why do both parties say, "Thank you"? It's because each side gives a gift to the other.

When I bought those rolls, this is precisely what happened. I saw rolls available and I decided that the rolls were worth more to me than the $2 I had in my pocket. From the store's point of view, the $2 was worth more than the rolls being given. Both parties walk away with a sense of being better off than they were before the exchange took place.

The checkout person is there to facilitate this exchange and speak as a proxy for the interests of the store. The store was receiving a gift of money (more highly valued than the rolls) and I was receiving the rolls (more highly valued from my point of view than the $2 I gave up to get them).

This is the essence of exchange and the core magic of what happens millions, billions, trillions of times every day all over the world. It happens in every single economic exchange that is undertaken by virtue of human choice. Both sides benefit.

Each side is a benefactor to the other side. This system of mutual benefaction, unrelenting and universal, leads to betterment all around. It increases the sense of personal welfare, which is to say, it increases social welfare when everyone is involved in the activity.

To be sure, a person might change his mind later. I might arrive home with my rolls and discover that I'm out of butter and that I would have been better off buying half as many rolls and using the rest of my money to buy butter. I might decide to drop bread from my diet. I might conclude that rolls are really not that tasty. All these things can happen.

Such is the nature of the universe that the future is uncertain and human beings are inclined to be fickle. But at least at the time of the exchange, I believed I was better off, else I would not have made the exchange in the first place. I walked away with a sense of gain. The store owners had the same sense of gain. We both expect to gain, which is enough to recommend the exchange system, since no social system can guarantee a happy outcome for every action.

Now, if all of this seems obvious and not even worth pointing out, consider that most philosophers in the history of the world have missed this point. Aristotle, for example, reflected at length in his Nicomachean Ethics on the issue of economic exchange, but he started with the assumption that exchange takes place when valuation is equal or commensurate. But what about cases in which it seems obviously incommensurate, such as when highly valued and rare physician services are traded for something widely available like corn? Aristotle believed that the existence of money serves to somehow equalize the exchange and make it happen, when it should be apparent that money itself is only a good introduced to make exchange more convenient.

The problem he faced was his initial premise that economic exchange is based on the equal value of items in the exchange. This is just wrong.

If two people value goods equally, an exchange would never take place, since no individual could be made better off than before. If exchange is based on equal value, people are merely wasting time engaging­ in it at all. Exchange in the real world is based on unequal valuations of goods and expectation of being made better off. It is a matter of two people who give each other gifts in their own self-interest.

The discovery of the correct theory of exchange had to wait until the late Middle Ages when the followers of St. Thomas Aquinas saw the logic for the first time. They saw that economic exchange was mutually beneficial, with each party to the exchange seeing an increase in personal welfare, subjectively perceived. Therefore the action of exchange on its own becomes a means of increasing the well-being of all people. Even if there is no new physical property available, no new innovations, no new productivity, wealth can be increased by the mere fact of exchange-based human associations.

As with many postulates of economics, this seems very obvious once you see it but it is evidently not obvious at all. In fact, I've observed that many people's underappreciation of the contribution of the market order is rooted in the perception that buying and selling stuff really amounts to nothing wonderful at all. It is just a swirl of churning and burning for the sake of nothing in particular. Society could easily do away with it and be no worse off.

I have a hard time figuring out what people who believe this are thinking. Let's say that I proposed abolishing gift giving. Wouldn't it be obvious that society would be worse off if I got my way? We would no longer enjoy the material manifestation of the appreciation of others, and we would all be denied the chance to show others our appreciation of them.

Well, if it is true, as I've argued, that an economic exchange is a two- way gift, an instance of mutual benefaction that is pervasive throughout society, it becomes clear that society would be completely sunk without as many opportunities as possible for economic exchange. Anyone who champions the well-being of society should especially celebrate commercial centers, stock markets, international trade, and every sector in which money changes hands in exchange for assets or goods. It means nothing more than that people are finding ways to help each other get by and thrive.

As sixteenth-century Spanish theologian Bartolomé de Albornoz, known mostly for his opposition to slavery, wrote,

Buying and selling is the nerve of human life that sustains the universe. By means of buying and selling the world is united, joining distant lands and nations, people of different languages, laws and ways of life. If it were not for these contracts, some would lack the goods that others have in abundance and they would not be able to share the goods that they have in excess with those countries where they are scarce.
However, if we do not quite see the underlying logic of exchange and how it works to help everyone, it is easy to underappreciate what market trading means to society. This is a tendency in the circles that discuss issues of social justice. The market is rarely given the credit it deserves for helping humanity improve its lot. In fact, the market is nothing but the cooperative interaction of humanity in improving the commonweal.

The fallacy of value equivalence in exchange has been refuted for some 500 years, and yet it keeps reappearing. Economics is one of those sciences that require careful thought. It can't be quickly intuited from a handful of moral postulates. It must be studied and understood with deductive tools and patient delineation of a wide range of concepts. It is because of this that economics as a science was so late in developing. But it is not too late for us to understand.

The understanding of economics leads to a direct appreciation of the contribution of free markets to the well-being of all. If you read something that seems to disparage the market economy, it is more than likely that a fallacy such as the above is at the root.

At some point today, you will undoubtedly engage in some economic exchange. Use the opportunity to reflect on what a glorious dynamic underlies it. You can say, "Thank you." The person who takes your money can say, "Thank you." Such opportunities account for most of the peace and prosperity we enjoy this side of heaven.


About the Author


Aug 15, 2013 - 1:10pm


and thoughtful. that was Puck.

Aug 15, 2013 - 2:08pm

Thank you for this

Thank you for this. It was nice to smile about Puck.

Aug 15, 2013 - 2:52pm


I've gotten a lot of feedback from folks requesting gold membership through PayPal.

We haven't yet set this up but, if you're dying to cross the wall, I can do one-time, annual subscriptions through the PayPal button. Just include your TFMR username in the PayPal memo section and we'll set you up manually.

Thanks everyone for all the support!

Aug 15, 2013 - 3:28pm

Puck was extremely well read

As for a mutual benefit or a fair price: I suspect the answer is; from whose perspective?

For the two individuals involved the trade, from THEIR perspective they must have both perceived a bargain (gain) (assume trade was freely entered into). However, from a third party, onlooker perspective, the two exchanged items would appear to have equal value.

As for trade adding to society: Yes, if it is for satisfying needs. One is thirsty; exchanges fish for water or coin for water.

However, when one speculates, (stock market) I think we enter a different game. As both seek an increase in financial wealth (usually) and as it is a zero sum gain, then as one wins, the other looses.

So we move from WIN-WIN



and as this game is often not a free market either and I suspect, it does not add to society but rather, detracts from it.

Man, I do miss Puck. Would have been good to have shared over a few beers.

Aug 15, 2013 - 3:38pm

Puck T. Smith....

...was the reason I kept reading TFMR. The way his mind worked was just incredible to me, and I miss him greatly. I wish I had the ability to think about a subject and arrive at amazing conclusions in the way that he did. There have been many people whom I have respected in my days, and there are quite a few here, but Puck thought about things in a different way than everyone else, and had an amazing ability to put his thoughts into words.

It is kind of strange to me to have such a mental attachment to some dude I did not know personally and met at a blog, but I am guessing that a lot of you feel the same way: Like you lost someone who made you think in a way that no one else ever had, and really did not know what the proper way was to say goodbye to him.

I think this is a great thing Turd. I also think that Puck would have been proud that this is the way you chose to honor him.

Like DPH said, gone but not forgotten.

Aug 15, 2013 - 4:36pm

Thank you

Not sure how long Google keeps a blogspot site up after it has become inactive. My goal is to peel off one or two a week to preserve them here.

Aug 15, 2013 - 5:50pm

@Turd Old Blogspots

Why don't you copy a bunch now and keep 'em on file. Love to see Puck live on here at TFMR.


Aug 15, 2013 - 7:08pm


I never read this sort of stuff from Puck - I appeared here too late.

Thanks Turd for finding this and posting it up. My response to something that he said here and stuck out for me - no criticism of him - just my observation after reading it:

"If two people value goods equally, an exchange would never take place, since no individual could be made better off than before."


"The fallacy of value equivalence in exchange has been refuted for some 500 years, and yet it keeps reappearing. Economics is one of those sciences that require careful thought. It can't be quickly intuited from a handful of moral postulates. It must be studied and understood with deductive tools and patient delineation of a wide range of concepts."

Puck doesn't address NEED. The true value of something cannot be studied and be understood through deduction. Using thought to try and arrive at something concrete to hold on to is a recipe for disaster. It always ends in failure.

Need is what drives existence - existence being what we wake up to each morning. Everything else is desire, in the mind, the pursuit of which always ends in disaster because it's not here now - it's always in an imaginary future.

Observing the difference between the truth of need (now) and desire (something in the future) removes the carrot that's driving the donkey on, and on, and on.

Deduction results in something that will always dissolve, be seen as false, in time.

So, that's my response to Puck's wonderful message. I shall agree to disagree.

Thought never solves a thing. It's one step away from reality, which is now, where I am, now. But few look at that. The majority are too immersed in thought.

Aug 15, 2013 - 9:22pm

"Thought Never Solves A Thing"

Dear Bollocks, I have always enjoyed your posts, and, I hope, in contradiction to prognostications, shall continue to.

Thought solves my boredom, and my feelings of...well, lots of feelings. I spend a lot of time thinking of the places I've been, the things I've seen, the things I've done, and some of the people I've met.

And, typically, it solves...well, lots of feelings.

Sure, all of that is still "in my head", so maybe it all counts as thoughts and counter-thoughts. But some of those thoughts are reflections upon the meeting of needs.

Perhaps "need" is only obsessive thought? I am hungrily thirsty, but can take one more step with no water.

Sorry, I'm a rank amateur at this philosophical stuff. Finding myself without two coppers to rub together would change my feelings, I'm sure.

Aug 16, 2013 - 6:50am

Please Turd

Can you open a new thread which is just for metals talk. Whilst I am sure the guest posts are a bonus it would still be the core to keep a main street thread alive. Its sort of the point of the site?

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